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February 5, 2016
  • Slow export sales drove wheat futures lower this week. Uncertainty about Egyptian import policies continued to weigh on markets after the world’s top wheat importer cancelled its second tender in a week. The U.S. dollar weakened week over week, but bearish market fundamentals continue to limit gains. CBOT March wheat dropped 12 cents to $4.66/bu, KCBT lost 18 cents to $4.54/bu and MGEX dipped 9 cents on the week to close at $4.91/bu. CBOT March corn decreased 6 cents to $3.66/bu and March soybeans lost 15 cents to close at $8.67/bu.
  • Gulf basis for nearby contracts continues to firm as loading delays continue due to fog, daylight navigation and high water. Rail freight basis to the Gulf continues to strengthen for nearby contracts due to increased demand from the diversion of river traffic. PNW basis for hard red spring (HRS) and hard red winter (HRW) is flat week over week due to slow farmer and export sales. Basis for soft white (SW) is firmer for nearby contracts due to the annual lock maintenance that will close the Columbia Snake River system for three weeks in March.
  • In its weekly Export Sales Report, USDA reported net sales of 66,200 metric tons (MT)—a marketing year low— for delivery in marketing year 2015/16. Sales, which were below trade expectations of 200,000 to 400,000 MT, were down 78% from last week and 74% lower than the prior 4-week average. Total known outstanding sales and accumulated exports of all wheat classes for marketing year 2015/16, through Jan. 28, 2016, were 16.8 million metric tons (MMT), 17% lower than last year's year-to-date total of 20.3 MMT.
  • After receiving no offers in last week’s Egyptian tender, Egyptian officials announced the return to the previous ergot specification of 0.05%. GASC cancelled another tender this week, however, because all its offers included risk management premiums.
  • StatsCan reported Canada wheat stocks at 16.4 MMT, down 24% year over year. Canadian durum stocks rose 3% to 4.22 MMT as of Dec. 31, 2015.
  • The Baltic Panamax Index closed at 298, another record low. Since Jan. 1, the Index has fallen 38%.
  • The Dollar Index dipped to 97.17, down 2% from 99.61 last Friday.
  • Current hard red spring (HRS) price indications are for Northern Spring. Dark Northern Spring is available, but premiums vary. Soft red winter (SRW) indications are for a minimum falling number of 250. Higher minimum specifications will carry a premium.

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